Legal Updates

Legal Updates for May 2016

Singapore and Cambodia : The Avoidance of Double Taxation
On 20 May 2016, the Government of the Republic of Singapore and the Royal Government of Cambodia signed a bilateral agreement for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income. This is the first bilateral agreement that Cambodia has entered into to move towards the ASEAN Economic Community since its launch in December 2015. This Update looks at the key aspects of this bilateral agreement.

Insight: CCS Paper on Quantifying the Benefits of Competition Enforcement
On 23 May 2016, in line with similar studies conducted by other competition regulators, the Competition Commission of Singapore ("CCS") published an Occasional Paper which looks at the quantitative effects of competition enforcement and advocacy. This Update looks at some of the key findings of the CCS and discusses the implications of these findings of possible future enforcement actions.

MAS Eases Regulations on Sale of Corporate Bonds to Retail Investors
The Monetary Authority of Singapore has announced the launch of two new frameworks which will facilitate the sale of corporate bonds to retail investors. Issuers which meet the eligibility requirements relating to their risk profile will be able to offer bonds directly to retail investors in denominations as little as S$1,000 without the need for a prospectus. This Client Update looks at the key features of the new frameworks and regulations.

Responsible Retrenchment in Singapore - Revised Guidelines and Implications
To assist companies in coping with the slowdown in growth and overall uncertainty about economic outlook, the Ministry of Manpower and its tripartite partners, National Trades Union Congress and Singapore National Employers Federation, released the revised 'Tripartite Guidelines on Managing Excess Manpower and Responsible Retrenchment' on 24 May 2016. This Update provides a brief summary of the key provisions under the Revised Guidelines and its implications on businesses in Singapore.

Indonesian Government Moves to Regulate App-based Transport Service Providers (ATSPs)
As a response to large-scale protests by taxi drivers in March this year, the Government has issued on 1 April 2016 Minister of Transportation Regulation No. PM 32 of 2016 on Unscheduled Public Transportation Services ("Regulation"). The Regulation, which comes into force on 1 October 2016, addresses, amongst others, the different types of unscheduled public transportation service (penyelenggaraan angkutan orang dengan kendaraan bermotor umum tidak dalam trayek), the rights and obligations of public transportation companies and, very specifically, the role of app-based transportation service providers ("ATSPs") in providing transportation services.

This Update provides an overview of the key features of the Regulation, with a focus on the relevant provisions relating to ATSPs.

High Court Determines Novel Issues on Unfair Preference
Where a company is insolvent, it is open to the court to reverse transactions which give unfair preference to certain creditors. In Living the Link Pte Ltd (in creditors’ voluntary liquidation) v Tan Lay Tin Tina [2016] SGHC 67, the High Court had the opportunity to determine certain novel issues regarding unfair preference transactions, including (i) whether the court can order the partial reversal of impugned transactions; (ii) the applicability of the running account principle in Singapore; and (iii) whether a director procuring such a transaction has breached his or her fiduciary duties.

India’s New Insolvency and Bankruptcy Regime
India’s upper house of Parliament has just passed the Insolvency and Bankruptcy Code 2016 on 11 May 2016. The Code will establish a new regime governing insolvency and bankruptcy in India, and aims to fix the flaws of the current system. This Client Update looks at the key features of the Code, as well as its potential impact and effects.

MAS Establishes FinTech Office, Announces Upcoming Public Consultation on Regulatory Sandbox, and Organises Singapore FinTech Festival
On 3 May 2016, the Monetary Authority of Singapore ("MAS") and the National Research Foundation established a FinTech Office to serve as a one-stop virtual entity for all financial technology ("FinTech") matters and to promote Singapore as a FinTech hub. On 12 April 2016, the Singapore FinTech Festival was launched in New York. It will be held in Singapore from 14 to 18 November 2016. Prior to that, on 2 April 2016, MAS Managing Director, Mr Ravi Menon, made remarks at a panel at the Singapore Forum, stressing MAS' intention to actively promote the FinTech ecosystem and harness its potential for good. In order to achieve this, MAS will actively engage FinTech firms, introduce a regulatory sandbox approach, and promote greater inter-operability across data systems. MAS has also indicated that it is working on proposed regulations for virtual currency intermediaries, which will be issued for public consultation when ready.

This Update discusses in more detail the role of the new FinTech Office, the proposed regulatory sandbox approach, and the formation of a new Financial Technology & Innovation Group within MAS' organisation structure which will be responsible for regulatory policies and development strategies to facilitate the use of technology and innovation in the financial sector.

Resolving Ambiguity in Contracts
Disputes about the meaning of contracts are often one of the largest sources of contractual litigation. In Hewlett-Packard Singapore (Sales) Pte Ltd v Chin Shu Hwa Corinna [2016] 2 SLR 1083, the Court of Appeal made a number of important observations in relation to the nature of contractual ambiguity in general and the contra proferentem rule in particular. The Appellant was successfully represented before the Court of Appeal by Gregory Vijayendran, Lester Chua and Pradeep Nair of Rajah & Tann Singapore LLP.

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